HOUSING, WOLVERHAMPTON (COUNCILLORS' VOTING RIGHTS) (Hansard, 28 March 1962)

§ Mr. John Baird (Wolverhampton, North-East)
I wish tonight to raise a matter which looked, at first, as if it were a purely local one, but which might be the thin edge of the wedge as far as all councils with Labour majorities are concerned. It is the refusal of the Minister to grant a dispensation to council house tenants and aldermen in my area of Wolverhampton to vote on a housing question. This has arisen because of a legal decision on a case which arose after the last election when, due to a technicality, the balance of the council was altered and the parties were almost equally represented in the council chamber. Since then, because of the death of one of our most distinguished aldermen, our majority has dwindled and now depends on the mayor's casting vote.
The Minister, though not refusing to grant a dispensation, was very slow in coming to a decision at the time of the most recent housing committee meeting. The result was that Labour councillors who lived in council houses felt that they would be running the risk of being involved in huge legal costs if they voted on this issue. As a result, the Conservative opposition were able to move two motions, one dealing with the sale of council houses, and the other dealing with the issue of differential rents for council houses.
At present, there are 60 members of the council, divided equally between the parties, but the mayor has the casting vote. Of these 60 members, at least 15 live in council houses. This means that a quarter of the members of the council are disfranchised as a result of the Minister's decision. I do not know how one can make democracy work in such a situation.
As I said, because of the death recently of an alderman, the Labour majority depends on the mayor's casting vote, which I have every reason to believe he will cast with the Labour group in control of the council. It is 1524 rather like you, Mr. Speaker. You usually lean towards the Government side, if anything, to see that Government business is carried through. This probably happens with the chairman of any council.
My second point is that in every election so far since the war a dispensation has been granted to councillors living in council houses to vote. Why has not this dispensation been granted now? Furthermore, why has a dispensation been granted to councillors living in council houses to vote on the question of the sale of council houses, but not on the question of differential rents? So far as I know, there is no other council with a Labour majority where this dispensation has not been granted.
The present Secretary of State for Commonwealth Relations stated in 1957 that where there was a Labour majority the councillors living in council houses should be granted a dispensation. There are 15 councillors in Wolverhampton living in council houses. After the war we did very well with our council house programme and the figure was among the best in the country. At that time there was, of course, a Labour Government. That is why there are so many councillors living in council houses in Wolverhampton. Yet they are all disfranchised. In one of the wards all the councillors are disfranchised, which means that between 20,000 and 30,000 people have no way of indicating their approval or disapproval over this matter. But they are to be troubled by snoopers, a means test, and all the other things which go with the worst type of differential rent system.
The Minister of Health shares with me the Parliamentary representation of Wolverhampton. The right hon. Gentleman may have put on the pressure. I do not know. But if he thinks that he will strengthen his party by taking this disciplinary action against some of the most decent citizens in the town he will find that he is mistaken, and that this will boomerang back upon him. When an election comes the tenants of the council houses will indicate their resentment of the differential rent scheme and the way in which it has been imposed on them. I am sorry that the Minister of Housing and Local Government is not present, for he is responsible for 1525 this major decision. I do not know whether the Minister has any of his old liberalism left. Perhaps he turned his coat long ago. If his so-called liberalism is more than skin-deep, he should reverse this decision immediately in the name of good democracy.

§ The Joint Parliamentary Secretary to the Ministry of Housing and Local Government (Mr. Geoffrey Rippon)
I can well understand the hon. Member for Wolverhampton, North-East (Mr. Baird) raising this matter, which is of importance in his constituency. I give him one assurance straight away. My right hon. Friend the Minister of Health had nothing to do with this decision. He was not concerned with it in any way. I am sure that the hon. Gentleman will welcome that assurance and that no one in Wolverhampton will be misled into thinking any different.

§ Mr. Baird
Who, then, sent the letter to the Town Clerk of Wolverhampton refusing the dispensation?

§ Mr. Rippon
I said my right hon. Friend the Minister of Health had nothing to do with this decision. The letter was sent from the Ministry of behalf of my right hon. Friend the Minister of Housing and Local Government.
I suggest to the hon. Gentleman—I am sure that he will accept this—that it is a basic principle of our local government system that a member of a council should neither speak nor vote when he has a direct or indirect pecuniary interest, unless he has received a specific dispensation enabling him to do so. The interpretation of what is a direct or indirect pecuniary interest within the meaning of Section 76 of the Local Government Act, 1933, has given rise to difficulty from time to time, but there appears to be no room for doubt about the position of councillors who are council house tenants. The courts have held that they have a pecuniary interest in any matter relating to the rents of council houses. It is clearly wrong, as I am sure the House will agree, for anybody to be able to vote in a matter in which he has a pecuniary interest, unless there are exceptional circumstances. Dispensation to speak, on the other hand, is usually 1526 readily forthcoming, as indeed it was in this case.
We are largely bound by Statute in what we do in this matter. Section 76 (8) of the 1933 Act empowers the Minister, or the county council in the case of parish councils, to remove either or both the disability to speak or vote in only two classes of case. He may give his dispensation either where the number of members of the local authority or the committee so disabled at any one time would be so great a proportion of the whole as to impede the transaction of business; or in any other case in which it appears to him that it is in the interests of the inhabtants of the area that the disability should be removed. As the hon. Gentleman pointed out, the policy governing the exercise of this statutory power is set out in Circular No. 30/56. This makes it clear that there are only two sets of circumstances in which the Minister will normally give a councillor who is a tenant of a council house dispensation to vote on a matter affecting rent. The circular says, in paragraph 5: The Minister believes that local authorities generally recognise that, where it can reasonably be avoided, it is undesirable that councillors should vote on a matter in which they have a pecuniary interest. Paragraph 6 says this: In cases where this issue does arise, the Minister will continue the existing practice of removing the disability on voting where half, or more than half, the members of a council or a committee would otherwise be disabled. That does not apply in the case we are considering tonight.
The relevant paragraph is paragraph 7, which reads as follows: However, circumstances may be such that the inability of even a small proportion of members to vote might possibly lead to the adoption of a policy to which the majority of a council were opposed. Where such a situation is anticipated the Minister would be prepared to give sympathetic consideration to an application for the removal of a disability to vote on issues affecting rent policy, provided that such application is supported by a resolution of the council and accompanied by a note explaining the circumstances. The underlying reason for the policy set out in this paragraph was explained in the letter which we sent to the Town Clerk of Wolverhampton on 26th February of this year. It is this, that my right hon. Friend feels it necessary for the will of the local electorate to prevail without regard to his own views on any 1527 particular issues at stake. There can be no question of political bias. In the past, when the Labour Party had a clear majority on the council, dispensation has been given to Wolverhampton councillors who are council house tenants in order to maintain that majority. Only recently in the case of Manchester my right hon. Friend gave a dispensation in such circumstances.
But I would say to the hon. Gentleman in all sincerity that quite different considerations arose when, on 15th February, there came this application from Wolverhampton for dispensation to discuss and vote on a proposal to discontinue the rate subsidy to council house rents and to introduce a differential rent scheme.
At that time the composition of the council was, on the Conservative side, 23 councillors and seven aldermen, making the 30 to which the hon. Gentleman referred; on the Labour side 21 councillors, eight aldermen and the mayor who, after the party's attempt to secure the aldermanic seats had been successfully challenged in the High Court, is not a member of the council otherwise than in his capacity as mayor. That makes the Labour Party total of 30. Thus, at the time the two parties were level in total membership. Labour control, as the hon. Gentleman said, was maintained only by the mayor's casting vote.
This situation, in our view meets neither the letter nor the spirit of paragraph 7 of the Circular of 1956. There was no majority of members to protect. Indeed, the Labour Party had a minority of elected members. That is why the dispensation to vote was refused in this case, although dispensation to speak was given. I accept that some confusion may have arisen because of the grant of dispensation to councillors who are council house tenants to vote on the sale of council houses. That was given a little earlier. However, as we explained in our letter to the council on 26th February, that dispensation was granted under the terms of an earlier circular, No. 75 of 1952, which was concerned only with the very narrow issue of the council's general policy on the sale of council houses. Here, it may be that the law is not so clear.
1528 Paragraph 3 of that circular points out that there may be a pecuniary interest. It states: Nevertheless, where a member who is a tenant of a house has no intention of buying or leasing his house, even if the local authority should decide to sell or lease houses, the Minister thinks the member might be held by the Courts not to have a pecuniary interest. Paragraph 4 states: Wherever it is decided that a member is disabled on account of a pecuniary interest, the Minister is prepared to entertain favourably any application for the removal of the disability (both as regards discussing and voting) so far as relates to the consideration of these general questions. Each application must however be related to a specific disability, transaction and occasion. If the House thought that this was inconsistent my right hon. Friend would be prepared to consider the position. The effect would be to cut down still further the circumstances in which a councillor who had an indirect or direct pecuniary interest would be allowed to vote. As I told the hon. Member for Bristol, Central (Mr. Awbery), in reply to a Question on 20th March, I am sure that it would serve neither the interests nor the reputation of local government to tamper with the principle that members of local authorities should neither speak nor vote on matters in which they have a pecuniary interest, whether that interest arises from tenancy of a council house or in any other way.
Certainly, the interest of a councillor who lives in a council house in a matter which affects his rent can be a substantial one. I think that is especially so in a case like the Wolverhampton case, where the matter under consideration was the discontinuance of a rate subsidy and the introduction of a rent rebate scheme. Of course, members who live in council houses are not disfranchised, as the hon. Gentleman suggested. They may take a full part in the many housing questions in which they do not have a pecuniary interest.
Where such interests do arise, my right hon. Friend is already willing to consider applications to speak provided that the interest is not special to the individual member. But dispensations to vote will be given only in the exceptional circumstances which I have outlined tonight, and I do not believe that such circumstances existed in the case the hon. Gentleman has raised.

§ Mr. Baird
Is it not a fact that in one of the wards to which I referred, a ward of about 15,000 people, all the councillors are council tenants?

§ Mr. Rippon
That may be so, but it does not affect the general principle laid down in the 1933 Act, or in the circular thereunder.

§ Mr. Michael Stewart (Fulham)
The Parliamentary Secretary made clear that the Government are not prepared to alter their decision in this case, but there is one consideration which I want him to take away with him and consider, since other cases of this kind might arise.
We understood that it had been the policy, as stated by the right hon. Gentleman who is now Secretary of State for Commonwealth Relations, that these dispensations to vote would be granted if the result of refusing them would be that the will of the majority of the members of the council would be frustrated. That was the policy formulated by the then Minister of Housing. The hon. Gentleman has tonight put an extra qualification on that. He said that what is relevant in the argument is the wishes not of a majority of members of the council, but, as he put it, of the majority of the elected members. It is only by putting that special gloss on it that he can justify the decision in this case.
I am not sure that that is wise, for this reason. Parliament in its wisdom, in framing the laws about local government, has taken the view that the popu- 1530 lar will, the will of the electorate as a whole, is best expressed not solely by electing councillors, but by making provision for the creation of aldermen by the councillors and for the election of a mayor, possibly someone outside the council. Whenever the merit and purpose of the aldermanic system have been argued, it has been suggested that in some way the existence of aldermen enables the popular will to be more accurately expressed over a period of time.
Opinions may differ as to whether aldermanship is a desirable institution or not, but it is at present part of the law of local government. The alderman is as much a member of the council as the councillor is. If the Minister now says that in interpreting the rule about dispensations he will pay attention only to elected members, to councillors, that is, we shall have a rather different principle applied. Before he applies it to any other cases, the Minister should consider what he is doing. He is really taking a view that derogates from the dignity and powers of the aldermen and the mayor who, whatever one may think about the institution of aldermanship, are legally entitled to be members of the council and work with the councillors in expressing the popular will of the electorate as a whole. There is a point here which the hon. Gentleman should consider carefully.